1) A supplier of a service who has rendered any kind of service to a person with regards to which an account has actually been supplied, will, despite the provisions of any other regulation, supply to the member involved an account or statement reflecting such particulars as might be recommended by doctors; 2) A medical plan will, in the case where an account may be provided, subject to the provisions in this Act along with rules from the medical scheme concerned, pay out to a member or provider of service, any benefit owing to that member or provider of service within thirty days following the day by which the law suit in respect of such gain was received by the medical scheme".
The problem arises whether this merely permits medical schemes to pay companies directly or whether it in actual fact create an obligation on medical schemes to make payments directly to providers, as happens to be quarreled by providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and Another v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a doctor, had no grounds upon which to demand that Medscheme (an authorized medical scheme) pay him directly.
On this decision, the Court seemed to acknowledge that although section 59(2) produces a basis upon which medical schemes are permitted to discharge responsibilities due to members by reimbursing providers directly, the section doesn't force a medical scheme to do this when the service provider had lodged an account with the medical scheme.
This view was verified in the recently decided and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS which had been heard by the North Gauteng High Court under case number 28532/11.
In this case the Applicant (a service provider) applied to Court on an emergency basis for an order pointing that the Respondent (an authorized medical scheme) make payment to them directly, and not to their associates.
The Applicant contended that the keyword in section 59(2) of the Act is "benefit owing to the customer or provider of the service" which on a common sense understanding of the area it means that when a member has not yet paid the supplier of the service the medical scheme doesn't have discretion but is obliged to repay the supplier.
The Court failed to concur with this argument, and held that section 59(2) must be construed in context. Subsection (1) provides that the provider of the service who's rendered a service is obligated to furnish the member related to an account comprising prescribed information. Subsection (2) then provides any time such an account happens to be delivered the medical scheme may pay to the member or the provider of the service the bonus owing to that member or provider of the service.
The Court also retained that, in the context of the section, the bonus yet to be paid must make reference to the amount owing by the customer to the supplier for the service supplied. The Court mentioned that it's inconsequential that the bonus will become owing to the member thanks to the agreement between the member and the medical scheme and, towards the supplier, thanks to the understanding involving the member and the provider. The subsection does not build an obligation on the medical scheme to pay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payment is subject to the policies of the medical scheme, and in the case of the Respondent it's rules stated unambiguously how the Respondent has got the right to pay out either the customer and the provider of the service.
Accordingly, the Court determined no grounds for an obligation on the Respondent to pay the Applicant directly and sacked the application along with charges.
From the above it is crystal clear that in order to ensure payment for services provided by companies must either claim repayment from their patients, or ensure that they have got contractual arrangements with the medical schemes. Right now, our Courts appear reluctant to demand a legal obligation on medical schemes to make repayment straight to service providers even without this type of contractual agreement.
The problem arises whether this merely permits medical schemes to pay companies directly or whether it in actual fact create an obligation on medical schemes to make payments directly to providers, as happens to be quarreled by providers.
The Top Court of Appeal, in Medscheme Holdings (Pty) Ltd and Another v Bhamjee [2005] ALL SA 16 (SCA), learned that Mr Bhamjee, a doctor, had no grounds upon which to demand that Medscheme (an authorized medical scheme) pay him directly.
On this decision, the Court seemed to acknowledge that although section 59(2) produces a basis upon which medical schemes are permitted to discharge responsibilities due to members by reimbursing providers directly, the section doesn't force a medical scheme to do this when the service provider had lodged an account with the medical scheme.
This view was verified in the recently decided and reportable matter of Tshwane Pharmacy (Pty) Ltd v GEMS which had been heard by the North Gauteng High Court under case number 28532/11.
In this case the Applicant (a service provider) applied to Court on an emergency basis for an order pointing that the Respondent (an authorized medical scheme) make payment to them directly, and not to their associates.
The Applicant contended that the keyword in section 59(2) of the Act is "benefit owing to the customer or provider of the service" which on a common sense understanding of the area it means that when a member has not yet paid the supplier of the service the medical scheme doesn't have discretion but is obliged to repay the supplier.
The Court failed to concur with this argument, and held that section 59(2) must be construed in context. Subsection (1) provides that the provider of the service who's rendered a service is obligated to furnish the member related to an account comprising prescribed information. Subsection (2) then provides any time such an account happens to be delivered the medical scheme may pay to the member or the provider of the service the bonus owing to that member or provider of the service.
The Court also retained that, in the context of the section, the bonus yet to be paid must make reference to the amount owing by the customer to the supplier for the service supplied. The Court mentioned that it's inconsequential that the bonus will become owing to the member thanks to the agreement between the member and the medical scheme and, towards the supplier, thanks to the understanding involving the member and the provider. The subsection does not build an obligation on the medical scheme to pay the service provider.
Additionally, the Court held that the subsection undoubtedly provides that payment is subject to the policies of the medical scheme, and in the case of the Respondent it's rules stated unambiguously how the Respondent has got the right to pay out either the customer and the provider of the service.
Accordingly, the Court determined no grounds for an obligation on the Respondent to pay the Applicant directly and sacked the application along with charges.
From the above it is crystal clear that in order to ensure payment for services provided by companies must either claim repayment from their patients, or ensure that they have got contractual arrangements with the medical schemes. Right now, our Courts appear reluctant to demand a legal obligation on medical schemes to make repayment straight to service providers even without this type of contractual agreement.
About the Author:
Learn about medical law and the medical schemes act from the best in the industry. Dirk Markhen is a specialist in construction law and also practices the law of medicine.
